Creative Destruction? Local Business Conditions and the Earnings of Employees at Startups
Jeroen Mahieu ()
MPRA Paper from University Library of Munich, Germany
What drives job quality in startups? In this paper, I examine how fluctuations in local business conditions affect wages in startups and incumbent firms in the retail sector. I identify shocks to local business conditions using plausibly exogenous variation of hurricane strikes in U.S. coastal counties. I find that, on average, wages of startup employees increase in response to negative shocks to local business conditions. This effect does not appear to be driven by changes in supply or demand for labor. These findings are consistent with a “cleansing” effect of downturns, fostering the creation and retainment of more productive jobs, and driving out unproductive ones.
Keywords: Startups; Employee Compensation; Local Business Conditions; Entrepreneurship (search for similar items in EconPapers)
JEL-codes: J21 J31 L26 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ent, nep-lma, nep-sbm and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
https://mpra.ub.uni-muenchen.de/98557/1/MPRA_paper_98557.pdf original version (application/pdf)
https://mpra.ub.uni-muenchen.de/98864/8/MPRA_paper_98864.pdf revised version (application/pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:98557
Access Statistics for this paper
More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().